California Organized Investment Network (COIN) Is a Collaborative Effort Between the California Department of Insurance, the Insurance Industry, Community Affordable Housing and Economic Development Organizations, and Community Advocates.

The Investigation Division investigates suspected fraud committed by insurance agents, brokers, public adjusters, bail agents, insurance companies and other individuals and entities transacting the business of insurance who perpetrate fraud against consumers.

Ex-insurance broker arrested for embezzlement

News: 2014 Press Release

For Release: June 18, 2014

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Email Inquiries: cdipress@insurance.ca.gov

Ex-insurance broker arrested for embezzlement

SANTA CLARITA, Calif.- John Monreal, 45, of Santa Clarita was arrested on May 30, 2014 by Los Angeles County Sheriff's Department deputies on 11 felony counts of embezzlement and insurance code violations, after he allegedly duped multiple consumers into believing they were insured while he collected their premiums.

"This kind of criminal activity harms insurance consumers," said Commissioner Dave Jones. "Our investigators will not tolerate criminals preying on insurance consumers. While the majority of agents and brokers are honest, it is a sad fact that there are a few bad apples that are dishonest and violate the public trust."

In March of 2010, the California Department of Insurance revoked Monreal's insurance license, listing 10 causes for discipline that included allegations Monreal was lacking integrity, conducting business in a dishonest manner, incompetency and diversion of fiduciary funds. A subsequent investigation found that Monreal continued to act as a broker at his business, the John Monreal Insurance Agency. Monreal issued checks to insurance carriers for the insurance policies that were eventually cancelled due to insufficient funds or partial payment.

As part of Monreal's scheme he would allegedly convince his clients to pay the full annual premium on an insurance policy in exchange for receiving a reduced rate. He would further insist that checks for the policies be made payable to him. He provided victims with a certificate of insurance that indicated they were covered, but in reality, only a portion of the premium was remitted to the insurance carrier, leaving the insured without coverage. In many cases, the consumers only realized that they had been defrauded when a collection agency representing the insurance company contacted them. In total, Monreal collected$10,703 in premiums from his victims for automobile, home and earthquake policies.

Bail for Monreal was set at $120,000. The case is being prosecuted by the Los Angeles County District Attorney's office.

The California Department of Insurance, established in 1868, is the largest consumer protection agency in California. Insurers collect $310 billion in premiums annually in California. Since 2011 the California Department of Insurance received more than 1,000,000 calls from consumers and helped recover over $469 million in claims and premiums. Please visit the Department of Insurance website at www.insurance.ca.gov. Non-media inquiries should be directed to the Consumer Hotline at 800.927.4357. Telecommunications Devices for the Deaf (TDD), please dial 800.482.4833.